Missed Tesla? Here's The Next $1 Trillion Company

Investors2021-10-26

The idea of an S&P 500 company hitting $1 trillion in market value used to seem impossible. But Tesla just did it — and analysts insist another is on the way.

Analysts think Facebook should be the sixth S&P 500 company valued at $1 trillion or more in 12 months or less, returning it to the trillion-dollar club. It would put the social networking giant in the same trillion-dollar league as Apple, Microsoft, Alphabet, Amazon.com and now Tesla.

Shares of Facebook closed Monday at 328.69, down more than 14% from the 52-week high. That parked the company's valuation at $927 billion. But that was prior to the company late Monday topping third-quarter profit forecasts by 1.3% and jumping in after-hours trading to north of 337 a share. At this price, Facebook is worth $950 billion.

It's only a matter of time until Facebook returns to the rarefied trillion-dollar air, though, say S&P 500 analysts.

Trillion Dollar Redux For Facebook

Predicting Facebook will be a $1 trillion company is somewhat of an anticlimactic call.

The company first closed above a trillion-dollar valuation back in July of this year. But since then, it's been on a rough run. Allegations of putting profit ahead of users' mental health, a high-profile outage and exposure to data limits at Apple knocked Facebook from its trillion-dollar perch. Snap's recent disappointing third quarter and warning of problems tailoring social media ads on iPhones only fanned the worries.

But analysts remain resolute on Facebook's future. They're calling for the stock to rally another 27% from Monday's close to 416.43 in 12 months, says data from S&P Global Market Intelligence and MarketSmith. And if they're right, that would make Facebook a company valued at $1.17 billion. Should you buy Facebook stock now?

Interestingly, if analysts are right, Facebook would supplant Tesla as the fifth most-valuable company in the S&P 500. Analysts actually think Tesla's stock will drop 23% to 787.15. And if that's correct, it means Tesla would be worth just $779.3 billion, or a third less than what they think Facebook will be worth in 12 months. Should you buy Tesla stock now?

Who's Up In S&P 500 After Facebook?

Facebook and Tesla might jockey for the trillion-dollar prize. But other than those two, are any other S&P 500 stocks anywhere near a trillion? Nothing immediate.

Warren Buffett's Berkshire Hathaway would appear next in line, as its market value is now $657.9 billion. Analysts, though, think even in 12 months time the company will be worth just $730.8 billion, falling shy of the trillion-dollar mark by nearly 40%. Also, it's not a particularly fast grower, so unlikely to surprise much to the upside. Analysts think Berkshire Hathaway's adjusted profit per share will only grow by 6.9% in 2022.

Visa is a likely candidate in due time. The payment processing firm is already worth nearly $500 billion. And its adjusted profit per share is seen jumping 25% in 2022 to $7.26. Even so, analysts don't think it's going to happen anytime soon. Analysts are calling for the stock to inch up just 0.9% in 12 months.

So it seems the world might need to be satisfied with five, or maybe six, trillion dollar companies for some time.

Analysts: The Most Valuable S&P 500 Companies In The Future

Current and projected market values

Company Ticker Stock YTD % ch. Market value now ($ trillions) Analysts' 12-month market value target Sector
Apple 12.0% $2.5 $2.7 Information Technology
Microsoft 38.5% $2.3 $2.5 Information Technology
Alphabet 56.8% $1.8 $2.2 Communication Services
Amazon.com 1.9% $1.7 $2.1 Consumer Discretionary
Facebook 20.3% $0.9 $1.2 Communication Services
Tesla 45.2% $1.0 $0.8 Consumer Discretionary
Berkshire Hathaway 25.5% $0.7 $0.7 Financials
Visa 6.9% $0.6 $0.6 Information Technology
Nvidia 77.4% $0.6 $0.6 Information Technology
JPMorgan Chase 34.5% $0.5 $0.5 Financials
Sources: IBD, S&P Global Market Intelligence
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精彩评论

  • glazedust
    2021-10-27
    glazedust
    Buy now then!
  • FannyNg
    2021-10-27
    FannyNg
    Good time to buy on the dip now?
  • Charging
    2021-10-27
    Charging
    [微笑] 
  • Cvt
    2021-10-27
    Cvt
    Like
  • Superstar_L
    2021-10-27
    Superstar_L
    Good 
  • Uasbau
    2021-10-27
    Uasbau
    Like it; tech stocks leading, i.e., Facebook, Apple, Amazon, Microsoft, Google
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